With an increasing amount of data created by automotive dealerships, manufacturers and vehicles, approximately 68% of dealerships believe adoption of artificial intelligence (AI) has had a positive impact on their businesses, according to a study by CDK Global, Inc., a leading automotive retail technology company.
“Today’s world is undoubtedly data driven, and every transaction that happens between the dealers, manufacturers and consumers is an essential data source that can be used to build more simple and convenient buying and ownership experiences,” said Mahesh Shah, chief product and technology officer, CDK Global. “For this to happen, we must come together as an industry to exchange data in a fast, reliable and secure way through platforms that are built on modern, cloud-based architectures. The results of our research are encouraging and tell us dealers are excited about the possibilities of AI and how it will help them meet their financial and customer satisfaction goals.”
AI technologies provide significant and measurable benefits across other industries. In a survey by McKinsey & Company1, 63% of respondents reported revenue increases due to the use of AI applications with average gains of around 10%. Within automotive retail, AI can be used to solve some of today’s biggest dealer challenges, which include addressing employee and skills shortages by replacing resource-intensive tasks and augmenting employee skills; attracting customers by looking at existing sales and service profiles and determining their propensity to buy; and retaining existing service customers through proactive and personalized service and by better predicting potential vehicle issues.
CDK’s Artificial Intelligence in Automotive Retail Report highlights the use of AI tools in automotive retail today and the optimism for the benefits it will provide dealerships in the future:
- Dealers are familiar with artificial intelligence (75%), with 40% feeling extremely or very familiar with the topic.
- Dealerships are already using AI or plan to do so within the next three to five years (68%).
- Dealers who don’t use AI today, but plan to in the future, anticipate positive outcomes (56%).
- Only 2% of the respondents said that they didn’t see their dealership using AI-based applications in the future.
As in other industries, automotive retail is investing in AI and is already seeing the benefits. Whether a dealership is currently using AI or plan to, nearly all the respondents believe AI will be an integral part of dealership operations.